CSCO » Topics » UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS

This excerpt taken from the CSCO 8-K filed May 12, 2006.

UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS

The following unaudited pro forma combined balance sheet as of January 28, 2006 and the unaudited pro forma combined statements of operations for the year ended July 30, 2005 and the six months ended January 28, 2006 are based on the historical financial statements of Cisco Systems, Inc. (“Cisco”) and Scientific-Atlanta, Inc. (“Scientific-Atlanta”) after giving effect to Cisco’s acquisition of Scientific-Atlanta (the “Acquisition”) using the purchase method of accounting, and Cisco’s issuance of $6.5 billion in aggregate principal amount of senior unsecured notes (the “Borrowings”), the proceeds of which were used to finance the Acquisition and for general corporate purposes. For the purposes of these illustrative pro forma combined financial statements, the entire Borrowings and the related interest expense were included in the pro forma adjustments.

The unaudited pro forma combined balance sheet as of January 28, 2006 is presented as if the Acquisition and the Borrowings occurred on January 28, 2006. The unaudited pro forma combined statements of operations are presented as if the Acquisition and the Borrowings had taken place on August 1, 2004. For additional information, please see the assumptions and adjustments described in the accompanying notes to the unaudited pro forma combined financial statements.

Cisco and Scientific-Atlanta had different fiscal year ends. Accordingly, the unaudited pro forma combined balance sheet combines Cisco’s historical consolidated balance sheet as of January 28, 2006 with Scientific-Atlanta’s historical consolidated balance sheet as of December 30, 2005. The unaudited pro forma combined statement of operations for the year ended July 30, 2005 combines Cisco’s historical consolidated statement of operations for the year ended July 30, 2005 with Scientific-Atlanta’s historical consolidated statement of operations for the year ended July 1, 2005. The unaudited pro forma combined statement of operations for the six months ended January 28, 2006 combines Cisco’s historical consolidated statement of operations for the six months ended January 28, 2006 with Scientific-Atlanta’s historical consolidated statement of operations for the six months ended December 30, 2005.

The Acquisition has been accounted for under the purchase method of accounting. Under the purchase method of accounting, the total purchase price presented in the accompanying unaudited pro forma combined financial statements was allocated to the assets acquired and liabilities assumed based on their estimated fair values. The excess of the purchase price over the net of the amounts assigned to tangible and identifiable intangible assets acquired and liabilities assumed is recognized as goodwill.

The unaudited pro forma combined financial statements have been prepared for illustrative purposes only and are not necessarily indicative of the consolidated financial position or results of operations in future periods or the results that actually would have

 

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been realized had Cisco and Scientific-Atlanta been a combined company during the respective periods presented and had the Borrowings been completed at the specified times. The unaudited pro forma combined financial statements, including the notes thereto, should be read in conjunction with Cisco’s historical consolidated financial statements included in its Current Report on Form 8-K filed on February 10, 2006 and in its Form 10-Q for the six months ended January 28, 2006 filed on February 21, 2006, as well as Scientific-Atlanta’s historical consolidated financial statements included in its Form 10-K for the year ended July 1, 2005 filed on August 26, 2005 and its Form 10-Q for the six months ended December 30, 2005 filed on February 8, 2006.

 

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